The Hindu Business Line : Honda Siel to spend Rs 150 cr to raise capacity

HONDA Siel Cars India Ltd (HSCIL) will be investing Rs 150 crore to ramp up its capacity to 50,000 units annually. It is eyeing an over 50-per cent growth in turnover to Rs 2,500 crore this fiscal.

"We are investing Rs 150 crore to increase capacity to 50,000 units per annum by the end of calendar year 2005 from the present 30,000 units," said the HSCIL President and CEO, Mr H. Yamada, while speaking at the launch of a new variant of the company's sports utility vehicle (SUV) CR-V.

The company had revenues of Rs 1,600 crore last fiscal. Having wiped out an accumulated loss last year, HSCIL is also targeting a net profit of over Rs 100 crore during 2004-05 against Rs 75 crore during 2003-04.

Meanwhile, the company, which is 99 per cent owned by Japanese firm Honda and one per cent by the Siel group of India, plans to sell 37,000 units this financial year.

The company aimed to sell 32,200 units of City sedan, 3,000 units of luxury sedan Accord and 1,800 units of CR-V, he said. Currently, City has a 29 per cent market share, Accord 40 per cent and CR-V 28 per cent in their respective categories. HSCIL on Tuesday also launched a variant of CR-V to tap the growing SUV market in India.

The CR-V model with a manual transmission has been priced at Rs 14.57 lakh (ex-showroom, Delhi), while the automatic version will cost Rs 15.57 lakh. The company will bring CR-V into the completely built unit (CBU) format from Japan and is aiming to sell 1,500 units during 2004-05.

HSCIL launched the SUV in July 2003 and has sold 1,800 units of CR-V till date.

Asked if the company would start manufacturing the vehicle in India, Mr Yamada said, "Once we reach a critical mass of say 3,000 units annually, we may think of manufacturing it in India." On whether the company would introduce the diesel variant of the vehicle, he said that though Honda sold the diesel CR-V in Europe, it did not have any plans to introduce the diesel model in India.

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